SOUTH LAKE TAHOE, CA — Tahoe Stateline Venture, LLC, has entered into a purchase agreement with Jianping Pan, Kawana Holdings LLC to sell part of The Chateau at the Village for $42.5 million, according to Owens Realty Mortgage.

Formerly known as "the Hole," the property was untouched for many years after a developer tore down existing structures before running out of money during the recession. Owens Financial purchased the property, located on Lake Tahoe Blvd. near the casino corridor, and began creating residential and commercial units.

Tahoe Stateline Venture is a subsidiary of Walnut Creek-based Owens Realty Mortgage, which is managed and advised by Owens Financial.

The first phase of the project was completely in October 2014 and consisted of 31,000 gross square feet of retail space at a cost of $21.5 million. This space now houses retail stores and restaurants like McP's Taphouse Grill.

The next phase of the project, estimated at $48 million, kicked off September 2015 and includes an additional 20,000 gross square feet of retail, 30 high-end condominiums and a common area of more than 44,000 gross square feet. The area is known as Zalanta, and Chase International is handling the condo sales, which range from $895,000 to over $2 million.

Subterranean parking for 535 stalls has also been developed.

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Eleven and a half acres of the retail and residential development site were put up for sale with no listing price towards the end of 2015 through real estate firm Kidder Mathews.

Kawana Holdings has agreed to purchase approximately 8 acres of land and entitlements, including related parking and garage structures. This does not include existing retail buildings and improvements.

In order for the sale to move forward, a number of conditions must be met, including satisfactory due diligence by Tahoe Stateline Venture and approval by the City of South Lake Tahoe of a tentative map.

The transaction is expected to close around March 31, 2017 or within seven business days following approval of the map.

"There is no assurance if or when the sale of the TSV Property will be consummated," stated Owens Realty Mortgage.

Kawana Holdings has paid an initial deposit into escrow of $500,000, and an additional $12.5 million will be added before Nov. 18. Tahoe Stateline Venture will credit the buyer $3 million for expenses. The remaining $32.5 million will be paid at closing.